Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/149302
Authors: 
Itaya, Jun-ichi
Mizushima, Atsue
Year of Publication: 
2016
Series/Report no.: 
CESifo Working Paper 6215
Abstract: 
We investigate how income inequality affects social welfare in a model of voluntary contributions to multiple pure public goods. Itaya, de Meza, and Myles (1997) show that the maximization of social welfare precludes income equality in a single pure public good model. In contrast, we show that the result of Itaya et al. may not be valid in a case of multiple voluntarily supplied public goods; specifically, we show that not only an income inequality-raising redistribution policy but also an income-equalizing one may raise social welfare. We also show that if altruistically motivated voluntary transfers are allowed, an inequality-raising redistribution policy is no longer effective and leaves social welfare unchanged.
Subjects: 
public goods
inequality
social welfare
voluntary provision
income distribution
JEL: 
D31
D63
D64
H23
H31
Document Type: 
Working Paper

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